What Romney said and meant!

KRUGMAN (2/24/12): Given his advisers, then, it seems safe to assume that what Mr. Romney blurted out Tuesday reflected his real economic beliefs—as opposed to the nonsense he pretends to believe, because it’s what the Republican base wants to hear.

And therein lies the reason Mr. Romney acts the way he does, why he is running a campaign of almost pathological dishonesty.

For he is. Every one of the Romney campaign’s major themes, from the attacks on President Obama for going around the world apologizing for America (he didn’t), to the insistence that Romneycare and Obamacare are very different (they’re virtually identical), to the claim that Mr. Obama has lost millions of jobs (which is only true if you count the first few months of his administration, before any of his policies had taken effect), is either an outright falsehood or deeply deceptive. Why the nonstop mendacity?

Is Romney “running a campaign of almost pathological dishonesty?” Is he engaged in “nonstop mendacity?” In a forum as important as this one, we’d stay away from psychiatric-sounding language. But Krugman’s statements are in the ballpark.

Therein lies the bad news.

Romney could still end up in the White House. For that reason, Krugman’s basically accurate statements are bad news for all Americans. We don’t know if anyone has ever run such a weirdly disingenuous White House campaign. It’s hard to imagine where this leads if Romney gets to the White House.

That said, we were struck by the way Krugman started his column, not by its gloomy conclusions, which made a great deal of sense. As a reader, we were struck by the way he presented the highlighted quotation from Romney—the quotation which forms the basis of today’s rumination:

KRUGMAN: According to Michael Kinsley, a gaffe is when a politician accidently tells the truth. That’s certainly what happened to Mitt Romney on Tuesday, when in a rare moment of candor—and, in his case, such moments are really, really rare—he gave away the game.

Speaking in Michigan, Mr. Romney was asked about deficit reduction, and he absent-mindedly said something completely reasonable: “If you just cut, if all you’re thinking about doing is cutting spending, as you cut spending you’ll slow down the economy.” A-ha. So he believes that cutting government spending hurts growth, other things equal.

The right’s ideology police were, predictably, aghast; the Club for Growth quickly denounced the statement as showing that Mr. Romney is “not a limited-government conservative.” On the contrary, insisted the club, “If we balanced the budget tomorrow on spending cuts alone, it would be fantastic for the economy.” And a Romney spokesman tried to walk back the remark, claiming, “The governor’s point was that simply slashing the budget, with no affirmative pro-growth policies, is insufficient to get the economy turned around.”

But that’s not what the candidate said, and it’s very unlikely that it’s what he meant. Almost surely, he is, in fact, a closet Keynesian.

Is Romney a closet Keynesian? We have no idea. In our view, he has seemed to dissemble about so many things that we don’t know if he believes anything at all at this point. But we were struck by that highlighted quotation—and by the way Krugman judged what Romney likely meant.

On their face, Romney’s 22 words seem to be a heresy for those on the pseudo-right. According to Krugman, the Club for Growth quickly snapped off a reply, insisting that we should balance the budget with spending cuts only. (The group is often confused with the Hair Club for Men. In fact, there is no connection.) Meanwhile, Romney’s spokesperson explained what he supposedly meant. Romney meant that we should have pro-growth policies and spending cuts, the campaign officially said.

According to Krugman, “it’s very unlikely” that this is what Romney meant. In his opening paragraph, he seems to assert a stronger degree of certainty.

Krugman offers a chain of reasoning in support of this view. But he offers no context.

Krugman tells us what Romney meant. As a reader, we are wondering what he said. Did he utter those 22 words and not a word more? If he only uttered those 22 words, are they sufficient to form a judgment? Are they even worth discussing?

As a reader, we were surprised that Krugman offered no context for Romney’s remark—and no explanation for the lack of context.

As we devoured Krugman’s column this morning, we hadn’t yet researched Romney’s remark, although we’d seen it flogged on cable. Even now, as we type, we still haven’t researched the 22 words; we expect to do so this weekend, after a bit of a train ride. But as a reader, we were struck by the lack of context in Krugman’s piece. What were Romney’s fuller remarks? What exactly had he been asked? What else, if anything, did he say? Surely, a serious person wouldn’t judge what Romney meant without considering the fuller context, if there is one.

We make this point for a reason. On cable “news” channels, the silly, tightly-clipped pseudo-quotation has become a reliable staple. MSNBC is now a master of this practice. A tiny portion is pulled from a longer remark; gangs of chimps then sit around misrepresenting what was actually said. This is now one of the principal ways the chimps entertain us baboons.

The “press corps” has mastered variants of this technique over the course of the past twenty years. Even back in the 1990s, this was one of the principal ways our “journalists” would go after targeted pols. The technique is now a reliable standard on our “liberal” cable “news” channel. And by the way:

When we let journalists function this way, we give them enormous power. This year, they may decide to use this power against a GOP front-runner. But in the past, they have played this game against a string of major Dems—and they may flip back the next time.

As a general matter, this is the way we rubes get made dumb. This is the way we give control of our minds to gangs of chimps.

Like most people who will read Krugman’s column, we haven’t done the background research (yet). But as we read the column, two questions popped into our mind:

41 comments:

Krugman did provide more context on his blog, but his columns have a stricter word limit. I worry that in flagging Romney as a "closet Keynesian," it will provide cover for "moderates" and "centrists" to start supporting him, despite the fact that as a Republican leader with a far-right Congress (especially in the House), he would basically be a rubber stamp for whatever the far right wanted to do.

His economic plans laid out so far are insane and would explode the deficit and the debt; he has called for attacking Iran, a war we could not possibly afford nor deal with (Iran has 70 MILLION people and a huge standing army, and we'd draw the wrath of the entire Muslim world); he supported socially extreme legislation, which I think he believes in even less than he does a more progressive economic approach; and he will not even admit he was GROSSLY wrong on the car company bailouts.

Romney's a hopelessly awful candidate and potential leader, really, but it seems he is the hopeless puppet the GOP establishment wants. Say what you will about George Walker Bush, but he did have some convictions, wrong as they were, such as "compassionate conservatism" and a true lust for launching unfunded and unsustainable wars. What Romney believes in no one can say; his plans, as he's outlined them thus far, portend an even worse disaster that W. Bush.

Paul Krugman is a brilliant economist. He would be a great op-ed writer if he weren't such a partisan. E.g., he brands Romney as liar for talking about Obama's apologies. It's a fact that Obama expressed regret for actions the US had taken which harmed others, although Obama didn't use the word "apologize" or "sorry". I think it's reasonable to call such statements apologies. Even if Krugman disagrees, this isn't a lie; it's just an interpretation of what the President said.

Anyhow the point I want to make is that AFAIK Krugman could do a better job of explaining what "Keynesianism" is. Here are some key points, as I understand it. I'm an actuary, not an economist, so feel free to correct me.

1. According to Keynes, government spending in excess of revenue boosts the economy. In that sense, both Bush's tax cuts and Obama's spending increases are approaches that are supposed to boost the economy. (BTW a decade of Bush/Obama deficits don't seem to have worked so well, do they?)

2. In theory, spending increases may be better than tax cuts, because they can be targeted to help the economy. In practice, tax cuts are arguably better, because spending increases seem to wind up targeted more for political reasons than for economic ones.

3. Even if one believes that an unbalanced budget will boost the economy, it doesn't necessarily follow that one should favor an unbalanced budget. Three reasons why:-- Interest on the borrowed money will be an ongoing drag on the economy-- The borrowed money must be paid back, a process that will slow the economy-- If the country keeps borrowing without repayment, disaster eventually ensues. The Greek riots show where that course leads.

Point #3 is seldom mentioned, but it's obvious if you look at personal spending. Can you live better today by going into debt? Sure. You can buy more stuff. Does that mean that you should go into debt? Not necessarily, because you'll pay interest on that money you borrow, and because you'll have to pay the debt back Examples of this principle are seen in the unfortunates, who, as students, borrowed huge amounts to go to college and now find those loans hanging around their necks, deterring many other things they'd like to spend money on today.

Ah David. You flaunt your misunderstandings of Keynesian economic ideas once again, though you've been corrected many times here, pretending you have no idea of the differences between debt in an economy that is growing and one in a liquidity trap? Of course.

You conflate households with governments, as foolish as you must know the comparison is? Of course.

You return again to comparing governments that borrow in their own currency with those that do not control their currency? Of course you do.

Why should anyone bother correcting you again?

As my father would have said, "It's like water off a duck's back."

Someone else said "You ain't gonna learn what you don't wanna know." -- You've proven it time and time again.

In practice, tax cuts are arguably better, because spending increases seem to wind up targeted more for political reasons than for economic ones.

You could argue that tax cuts are better, but it's a bad argument. They're not, because many people save the tax rebate instead of spending it.

And you concede that Krugman is a brilliant economist, but then you make point #3, which he's debunked millions of time as it pertains to right now, in the United States. His point is that you increase government spending and run unbalanced budgets temporarily, when you're in a recession, and then balance the budget when the economy is flush again. If point #3 really made sense as you described it, we'd have runaway inflation. I know you will tell me that runaway inflation IS RIGHT AROUND THE CORNER, just as conservatives have been saying since 2008.

Understood: statements are routinely taken out of context and often misconstrued on purpose, to further one narrative line or another. This sort of thing is, after all, famously well-suited to a sound-bite culture. But how about a little perspective?

Out of the hundreds of expressed opinions available in the last 24-hours in official print and media, the balance of which is overwhelmingly right-wing and center-right, the most significant lapse The Daily Howler can find is Paul Krugman's quote of Mitt Romney -- this despite the fact that Krugman prints the Romney camp's defense of the statement as quoted by Krugman, in lieu of the possibly non-existent context, and which the Romney camp provided after-the-fact.

So we have, in the standard 800 word column, the original statement, and the Romney's campaign explication of it, after the fact. But that's still not good enough, apparently.

With preoccupations like these, and demands like these, no wonder progressives lose every policy fight.

Bob's point also is that given how much the Republicans, conservatives and neoconservatives have degraded the public discourse, it doesn't serve Democrats, liberals and progressives, three groups which are not completely coextensive, to follow suit.

It also doesn't serve liberal or progressive interests to let off the hook over and over the mainstream media or liberal media figures who do the work of the Republican Party and its interests, because ultimately, it's clear that when Republicans have gained power since 1953, in general the broad public loses out.

Not just liberals and progressives, but the broader public, economically, socially and politically. This isn't happenstance, it's by design.

It's also by design that the Matthewses and O'Donnells and Maddows and Schultzes and so on, and their numerous hangers-on and sycophants, will catapult the propaganda to varying degrees, like the right-wing shills and hatchet gang do, in the interests of lining their pockets and those of their friends. Perhaps it's human nature. But we all suffer as a result of it.

But Krugman *isn't* following suit: equating Krugman's "failure" to give what Somerby considers sufficient context -- despite the fact that Somerby doesn't even know if that context exists -- is ridiculous.

MSNBC employees are corporate shills. Period. "Progressives" and "liberals" have no more responsibility for what they do and fail to do, than they do for what gets said on Fox.

The trouble here is, Somerby is so thoroughly wedded to his narrative that he finds it wherever he looks -- and his critique is so obvious and self-evident with respect to the right-wing world and corporate journalism generally, that he has to turn Krugman, apparently in desperation for more meat. Nothing, apparently satisfies his standards, notwithstanding the demands of mass-media culture and the fact that the outcome of American elections are determined by "low information" voters. Some hobby-horses just have to be ridden, into the oblivion where we get to re-run the 2000 election and Al Gore gets elected.

But no matter. Keep up the nitpicking. Maybe we'll get a journalist who finally satisfies all the Howler requirements, twice a week, in 800 words or less. It's unlikely such a fellow would be readable -- after he reprints the official campaign literature to be scrupulously fair, there won't be much run for his own analysis -- but you never know.

"If you just cut, if all you're thinking about doing is cutting spending, as you cut spending you'll slow down the economy," he said in part of his response. "So you have to, at the same time, create pro-growth tax policies."

"If you just cut, if all you're thinking about doing is cutting spending, as you cut spending you'll slow down the economy," he said in part of his response. "So you have to, at the same time, create pro-growth tax policies."

Krugman deceived readers or was just too careless to bother to find out what Romney said. I do not care whether Romney was right or wrong, but I do not like being deceived by a person I admire or thought I admired.

Krugman had to have known that he was distorting what Romney said, but Krugman did not care enough to either find out or write honestly. Can any Democrat be trusted to tell the truth anymore when it comes to what is thought to be political gain?

I think Bob is being too hard in The Professor. Many, many times I have heard Romney utter flat out lies. Lies he has himself contradicted on other occasions.

Bob seems to demand a purity of language that even Alfred Korzybski would deem unnecessarily strict.For instance, the term "pathological liar" is used loosely in everyday language as a synonym for compulsive liar.

I have known at least three compulsive liars. I knew them all for more than a year, and interacted closely with them. One was a college roommate , one was a stepdaughter's husband, and one was a co-worker for two years.What they had in common was an ability the answer questions quickly with false statements, and to recover almost instantly with another lie when caught.

They didn't seem to remember having made contradictory statements in the past.

For instance Romney said over and over that we should have let GM and Chrysler fail. Than he recently claimed he didn't say fail, he said a structured bankruptcy.He said Romneycare is nothing like Obamacare, when it is.

He says whatever seems to be the answer needed at that moment without realizing what responses he has given before. He is a compulsive liar. His false words are far and above a mere twenty-two.If that is psychoanalysis-at-a-distance, so be it.

And no, I have not done the background research (yet), but I have just spent a year on Planet Earth where I have been unable to escape many of Romney's lies.I really don't want to spend time proving Mitt Romney is liar.

I can't blame the media all the time. Do you remember Romney's answer to what he thought was the most common misconception about him?How will you get these people to answer the questions asked without using enhanced interrogation?

All we have to do is replace Obama. ... We are not auditioning for fearless leader. We don't need a president to tell us in what direction to go. We know what direction to go. We want the Ryan budget. ... We just need a president to sign this stuff. We don't need someone to think it up or design it. The leadership now for the modern conservative movement for the next 20 years will be coming out of the House and the Senate.

That's what they want. He also threatened to impeach Obama if he doesn't extend the Bush tax cuts. Professor Krugman is one of the few who's regularly calling this crap out. Very few other major online or onscreen "liberals" will open their mouths, except to salivate over poor Seamus the tortured hound and gotcha quotes and Callista's hair and baubles and that very creepy Dark Age-loving Rick Santorum, whose wife's behavior defies all the things he supposedly claims to want to impose on everyone else (cf. tort reform, reproductive options, etc.).

"[Krugman's] point is that you increase government spending and run unbalanced budgets temporarily, when you're in a recession, and then balance the budget when the economy is flush again."

IMHO this is an example of Krugman's partisanship. When George Bush was running deficits a quarter of today's, Krugman wrote columns claiming, in effect, that the sky was falling. He didn't justify Bush's relatively small deficits on the basis that they'd get the economy moving and would be paid back when the economy was flush.

Furthermore, it's virtually inconceivable that these deficits will be paid back, and Krugman knows that. Within living memory, there were some balanced budgets in the 1940's and for 3 or 4 years during Clinton's administration. They ran vey small surpluses. But, President Obama has run up over $4 trillion of deficits. By the end of his first term the total will be over $5 trillion. It would take $5 trillion of federal surpluses to pay this back. Will that ever happen? In fact, Treasury Secretary Timothy Geithner's official long term projections don't show any surpluses ever. They show continuing huge deficits as far as the eye can see.

"I know you will tell me that runaway inflation IS RIGHT AROUND THE CORNER, just as conservatives have been saying since 2008."

For a guy who claims to believe in supply & demand, you're awfully to quick to attribute the rise in gas prices to the U.S. budget deficit..... On that basis, we just as plausibly argue that the drop in housing, wages and commodity prices points to deflation.

As for the deficits Obama "has run up", are you really unaware these high deficits, far from resulting from expansion of government programs, are actually attributable to 1) the Bush tax cuts, which were supposed to expire and which were were sold to the public on that basis precisely because they were unsustainable, 2) the increase in government payouts thanks to the depression, via safety-net programs which were created long before Obama became president, 3) decreased tax revenues, thanks to high unemployment, and 4) wars started during GWB term?

"On that basis, we just as plausibly argue that the drop in housing, wages and commodity prices points to deflation."

Yes, you are right, Anon. I gave a flip answer. Here's a serious one.

Inflation in 2011 rose to 3.0%, up from 1.5% in 2010. Monthly inflation in January, 2012 was at an annual rate of 4%, but only 2% on a seasonally adjusted basis. I don't know how the seasonal adjustment is calculated. There's been a big rise in gas prices at the pump during February. Furthermore, the price per barrel of crude oil continues to rise. When these crude oil price rises work their way into gasoline at the pump, I think it will go still higher. My local newspaper is talking about $5/gallon gasoline.

Fuel is a key expense for many businesses. I think they'll have to raise their prices, causing inflation to get worse. My guess is that inflation in 2012 will be in the range of 4% - 6%, and higher yet in 2013. That's not as bad as it was during the Carter administration. OTOH, Richard Nixon took the radical step of imposing wage-price controls when inflation had reach what they considered to be an unacceptible level -- 4%.

Economic theory says that printing money leads to inflation. You can find a many sources confirming this bit of economics.

In order to cope with the enormous deficit, the Obama Treasury did, in effect, print money via their Quantitative Easing programs. They are considering printing more money.

Being in a recession has held inflation down. Workers can't easily demand raises, because they're lucky to have a job. Sellers can't easily raise prices, because workers can't afford higher prices. In fact, it used to be believed that you couldn't have inflation along with high unemployement. That's what the Phillips Curve showed. However, Jimmy Carter defied the Phillips Curve and managed to achieve stagflation. It looks like Obama may be the second President to achieve stagflation.

David in California your comment suggests you are ignorant of the fact that the phenomenon of stagflation began plaguing the American economy during the Nixon/Ford term. One of the key factors contributing that economic difficulty is traced by certain economists to a late 1971 demand by Nixon, captured on his tapes, that the Federal Reserve Chairman juice the economy during the 1972 election year.

The worst unemployment rates recorded since the Bureau of Labor Statistics began tracking that number in 1948 occurred during in the twenty-second and twenty-third months of the Reagan presidency when U3 rose to 10.8%. Prior to that the highest recorded BLS unemployment was in May, 1975 during the Ford presidency when the rate was reached 9.0%. Inflation ran at 12.3% for 1974 and at 6.9% for 1975.

Unemployment was at 7.5% and rising in January of 1977 when Carter was sworn into office and at 7.5% and falling when he left office in January of 1981. During most of his term the rate was 1%, or more, below that figure. Unfortunately for his reelection campaign, the unemployment rate during his term in office peaked at 7.8% in July of 1980. And the inflation rate ran at 13.3% in 1979 and 12.5% in 1980.

However, if we are to accept Milton Friedman's claim that inflation is always a monetary phenomenon then Carter is hardly to blame for the bout of rising prices suffered during his term. The chief culprit, aside from oil shocks and disappointing productivity growth after 1973, was Arthur Burns whom Nixon put in at the Fed as its Chairman and whom, thereby, Carter inherited when he took office.

Paul Volcker is the person credited with ending the era's chronic inflation. It was Carter who, in 1979, sent Volcker's name to Congress for confirmation as Fed Chairman.

One final point. The National Debt as a percentage GDP fell during the Carter years. Its size relative to GDP rose dramatically during the Reagan years.

The "Obama administration" (it was actually the Federal Reserve) printed money because of enormous unemployment, not enormous debt. I can find all the economic theory and economic data saying that, in a liquidity trap, which we are in, printing money doesn't do a thing to inflation. But I'm going to stop now. You have demonstrated, as you did with global warming, that you are an enormous ignoramus, capable of nothing more than repeating the garbage from Hannity and Limbaugh and right wing think tanks.

By the way, ignoramus, you didn't even answer my actual question, which further demonstrates your core dishonesty.

DinC, our resident actuary, perfectly illustrates the old saw, "When the only tool you have is a hammer, everything looks like a nail."When the only talent you have is bean counting, every problem MUST be reduced to a number.